Electronic Filing Now Available for Corporate Taxpayers

Corporations, partnerships, S corporations, and fiduciaries can now electronically file their income taxes to the Arizona Department of Revenue (ADOR).

Legislation signed into law initiated a multi-year phase-in period for businesses required to file income tax returns electronically. The e-file option was introduced in 2020 for tax year 2019 and is now mandatory for corporations and partnerships for tax year 2020 returns (A.R.S. § 43-323(F)).

In addition to e-filing being faster and more secure, returns are verified quicker than paper submissions, which benefits taxpayers if any errors require their attention. When filed electronically, corporations receive two acknowledgments of receipt from both the IRS and ADOR via the service, so they will know their returns have been received and accepted. Last tax season, 53 percent of the 341,000 corporate tax returns were e-filed with ADOR.

About a dozen software product options are approved and available to submit corporate, partnership, and S corporation income tax returns for companies. Fiduciaries have about two dozen approved vendors to choose from and submit their returns.

Furthermore, businesses with an annual transaction privilege tax and use tax liability of $500 or more during the prior calendar year are required to file and pay electronically. Businesses with a $125 or more average quarterly liability for withholding tax during the preceding tax year are required to file and pay withholding tax electronically.

Businesses requiring more information on the ADOR e-file program can go to https://azdor.gov/e-services/e-services-corporations.

Monday, January 11, 2021